I live in Berlin, which was flattened at the end of WW2 by the Soviet army (and some allied bombers).
Today you'd barely know that happened. My favourite example is Gendarmenmarkt [0] - a square with three church buildings on it.
When I first took a walking tour around Berlin, the guide flatly said "these were built in the 17th century" with no mention of being almost completely rebuilt after the war. That lead to an interesting discussion along the same lines as this (Theseus' ship and all).
I think the difference is the history. Preserving the memory of that destruction as part of the restoration is important. There should be visible scars. By all means restore the building to be functional, a useful part of the city again. But leave some scars. I love that there are still bullet holes in some of the old walls around the city centre.
One of my favourite descriptions of Berlin is actually by Iain M Banks in The State of The Art [1], and it talks about this - that the history is what makes the place so special. Restoring everything so that the history is removed would also remove something unique and special about the city.
[0] https://en.wikipedia.org/wiki/Gendarmenmarkt
[1] This is just an extract, there are several references to Berlin in the story, which obviously is well worth reading - https://www.goodreads.com/quotes/794671-there-is-something-a...